Modern Mining March 2016

DIAMONDS

Stellar makes solid progress onWest African diamond projects

With a positive Preliminary Economic Assessment (PEA) in place and the process of obtaining a mining licence well advanced, Stellar Diamonds plc is hoping to start development of its Tongo Dyke-1 project in Sierra Leone later this year (subject to the availability of funding). The company will also be making a decision in the second half of this year on whether to advance its Baoulé kimberlite open-pit project in Guinea, which is currently the subject of a trial mining programme, to the feasibility phase. Stellar’s CEO, Karl Smithson, updated Modern Mining’s Arthur Tassell on both projects at this year’s Mining Indaba in Cape Town.

T he Tongo Dyke-1 project – located in Sierra Leone’s Eastern Province in the Kenema District – has the great advantage that it can be fast-tracked into production, with surface mining in the first four years providing cash flow while a shallow underground mine is developed. Given that it is a fissure-type de- posit, Tongo Dyke-1 is unlikely to ever support a huge mining operation and, in fact, the total

carat production over an 18-year mine life is estimated in the PEA at just 955 000 carats, with a peak yearly production of 85 000 carats. The economics of the project are nevertheless very robust. Adding to its appeal, the required capex to establish the infrastructure for both surface and underground mining is a modest – and manageable – US$24,8 million. Smithson is highly enthusiastic about the potential of the project. “Dyke-1 has a grade of 165 cpht, which is well above average, and the

Karl Smithson, CEO of Stellar Diamonds.

34  MODERN MINING  March 2016